Organise a budget
Before you can even start to budget, it is important to know how much you earn and how much your expenses are. This is a basic principle of money management That way you’ll know what you have to focus on the most, and what you have to focus on the least. When you spend more than you earn, you are heading for financial disaster. Anybody that thinks differently is ‘a fool unto themselves’.
Here are 4 quick guidelines to keep in mind when you are learning how to budget and manage your money successfully…
1. Calculate your regular income. Include all your income from all sources: your wages, tips, and interest on savings; overtime, and any other sources of income. Include the income that your spouse earns also.
2. Identify your expenses. First work out your regular expenses that you have weekly, monthly or quarterly. For most people these will be housing costs, taxes, insurance premiums, and utilities. Then for at least one month, record all your daily expenses – no matter how small the amount. (don’t forget the cappuccino you have every day) Save all your receipts and expense accounts. You might find it helpful to record them in a book, or a spreadsheet on your computer
3. Now, compare your income to your expenses. That means the money that you earn (income) and the money that you spend (expenses). If your expenses are more than your income, you need to take action fast!
4. Pay off your debts as soon as you can so that you can then start a regular savings plan. Use the money that you have saved to work for you. It is very important that you are committed to eliminating your debt.
By mastering the skill of how to budget your money successfully, you are putting yourself one step closer to being truly financially free. You owe it to yourself, and your family, to learn how to operate a budget!
Assistance for this article was given by Budget Bitch
If you need more help – then I suggest you contact Budget Bitch – where they ‘make people count’.
For more budget hints and tips log on to – BudgetTipStore